The markets were able to push upward despite the latest rumblings of bank/country debt downgrades/bailouts, etc.

Looking at some individual names, we saw positive reactions to mid-quarter updates from the likes of Texas Instruments (TXN) and Agrium (AGU). Shares of Boeing (BA) were up on a positive Wall Street analyst note. Looking at the financials, credit card plays Capital One Financial (COF) and American Express (AXP) paced the sector higher. After the bell, Dell Inc. (DELL) initiated its first-ever dividend payout, beginning in the third quarter. The annual payout will be 32 cents, which would equate to a nearly 2.7% dividend yield. It’s certainly a long-overdue event for the company and shareholders.

Middle Class Net Worth Takes a Hit

According to Federal Reserve data just being released, a hypothetical family richer than half the nation’s families and poorer than the other half had a net worth of $77,300 in 2010, compared with $126,400 in 2007. Much of the drop is being blamed on the fall in real estate prices. You probably remember the caution I have expressed regarding counting your home as a key investment/asset. My definition of a solid investment is one that produces monthly/yearly income. Unless one’s residence is producing income from tenants (multifamily units), then I would consider the residence as a low interest rate savings account — with potential for negative interest like we’ve seen in the past four years.

Another key data point was the drop in median family income to $45,800 in 2010, down from $49,600 in 2007. Many of us have seen or experienced the reality of a tough job market. With more people looking for work, employers are able to fill roles at lower salary levels. This trend is another brutal blow to the middle class. When you factor real inflation (not the reported mumbo-jumbo government numbers with all the exclusions) into the picture, the squeeze to the middle class is even more evident.

The ever-changing business landscape is also affecting the jobs market. Start-ups staffed by as few as a dozen or two motivated employees can use today’s technologies and tools to revolutionize industries and put many others out of work. While this trend works out great for entrepreneurs and early investors, in the end, there will be a price to pay. Average workers will remain in financial danger, whether from a wage standpoint or employment opportunity standpoint.

The key to not falling behind even further is to tighten up discretionary spending first and foremost. Next, adjust your living costs and figure out how you can free up money to start investing in assets that produce income. Working more than one job should be given serious thought by many able-bodied folks out there.

You’d be shocked at how many people are unable to pinpoint obvious blemishes in their financial gameplan. Young couples, for instance, often times overextend themselves as far as living arrangements go. Renting a two-bedroom apartment for $1,700 a month and spending the rest of their money on entertainment goodies (electronics, restaurants, etc.) is a fast-track to a mountain of debt.

So take a step back and consider what you can do to improve your finances. Freeing up the capital necessary to generate wealth is not hard, but without action, the clock will continue to run. Time will quickly become less of your ally and more of your concern.

How Far Will The Cheating Go?

With three kids in school and technology ever changing, it’s hard to not think about what the future holds when it comes to education. Reading a recent article that talked about the prevalence in cheating in online classes makes me cringe. The sad part is that these students end up skating through, while the hard-working students do what is asked and will sometimes get a worse grade.

Of course, we all figure these cheaters will eventually get caught, but the reality of the situation is that more and more are sneaking through. Now you may say they are only harming themselves, but the danger is when the cheating extends beyond education. Once people establish a pattern of cheating to get ahead, it’s difficult to turn off the spigot.

I have often talked to my kids about their school work, and how their hard work now will be reflected later in life. Eventually the moment of truth will come for those cheating. At that point, a true lack of real skills will likely backfire. We adults know that when times get rough, it comes down to what you know and how well you can execute on that skill that separates the real success stories from the fly-by-night scam artists.

Career Positioning

Whether you’re considering a career for yourself, your children, or grandchildren, the ideal fit will depend on several factors. Perhaps the most important factor is choosing an area that compliments your skill set. For instance, if you or a loved one is really good with computers, you may want to look into the tech space. Similarly, if you’re good with your hands, a trade school (plumbing, electrical) may be a good option.

Another area to focus on is the long-term value of the career. Try to narrow your search to areas that have good future prospects (think medical, for instance), and avoid industries on the decline. As for specific companies to work for, I suggest looking closely at companies that deliver consistent results and produce products or services that people love or need.

Finally, if you’re considering a change in employment, ask yourself if a big move will help maximize your earnings potential. If not, you may be better off sticking where you’re at. The sooner you can begin discussing these matters with your family, the better. That way, you’ll be better positioned to concentrate on investing and building wealth!

Income, Income, Income

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